The Many Returns of the Season

Dec 16, 2004
George Anderson

By George Anderson

What’s your return policy?

This and similar questions have been asked by holiday shoppers for years as gift givers face the reality that the absolutely adorable sweater or other wonderful item they wish someone would give to them might be returned before the ball drops in Times Square on New Year’s.

According to a new Harris Interactive study, 91 percent of consumers say a store or Web site’s return policy is a significant factor in their decision to buy in the first place. Ninety-two percent say knowing a return can be made without a hassle increases the likelihood that they will purchase from a retailer in the future. Conversely, 85 percent say they are likely to not shop in a store again if there is a problem returning merchandise.

The problem of returns for retailers is often exacerbated as consumers wait long periods of time before bringing merchandise back to a store. More than half of those responding to the Harris survey, 54 percent, said they have held onto unwanted merchandise for a month before returning it. Nearly one in four, 24 percent, have held onto an unwanted item from three months to over a year before bringing it back.

Moderator’s Comment: Does a retailer’s returns policy provide it with a point of differentiation from the competition? How important do you think this
factor is in determining consumers’ initial and future purchasing activity at a store or from a catalogue or e-tail site?

Newgistics, Inc., the sponsor of the Harris Interactive Study, estimates 20 to 30 percent all orders sent out by catalogue and online retailers will involve
a return.

In an interview with Internet Retailer back in August, Jonathan Dampier, the vice president of marketing for Newgistics said, “Sometimes, the idea
is that if a retailer makes returns easier, it will have more customers returning items. That doesn’t make sense. The alternative is having a customer who doesn’t return the item,
but is unhappy. Why would you want that?”

George Anderson – Moderator

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